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Pakistan

December 15, 2018

Billionaire Pakistani named in high profile insider trading case

Pakistan

Sat, Dec 15, 2018

LONDON: A multi-millionaire Pakistani national who bought a yacht built for billionaire Roman Abramovich has been named in connection with allegations of market manipulation in a high-profile insider trading case at the Southwark Crown Court brought by the Financial Conduct Authority (FCA).

Pakistani national Alshair Fiyaz’s net worth is estimated to be at US$3 billion. He hit headline when he bought the yacht Ecstasea which was built for Russian billionaire Roman Abramovich for $75 million.

During hearing at the court, the FCA prosecutor cross-examined defendant Walid Chocair and asked whether Pakistani national Alshair Fiyaz engaged in market manipulation with Chocair, a day trader whom the FCA accuses of making £1.4 million in profit trades made on the basis of insider information.

Richard Wormald, lawyer for Walid Choucair, 39, told the jury that Alshair Fiyaz made $8.3 million in profits from three trades that mirrored ones made by the defendant. The prosecution said Choucair made 1.4 million pounds ($1.8 million) profit from five trades in 2013 and 2014.

Richard Wormald revealed the information to the court after the prosecution had cast doubt over the trader’s defense that he was getting his investment ideas from associates including Fiyaz and not from his friend at UBS. The prosecution said it was "odd" for him to receive tips from his trading buddies, but to place the trades before them. Choucair responded that he went first, because the sums he was trading were less likely to move the market.

The trader said that his Pakistani associate was trading “high multiples” alongside him.

The prosecutors for the UK financial regulator allege that Choucair received tips from Fabiana Abdel-Malek, an ex-UBS compliance officer known to have accessed confidential information on deals and was using a burner phone to communicate with Choucair. Both deny the charges, saying their friendship was entirely social and they were not involved in market manipulation.

It emerged during the proceedings that in April 2014, Choucair arranged to meet with Fiyaz at a hotel in Knightsbridge to discuss rumors around a takeover of NorthStar Realty Finance Corp. Its alleged that shortly before the meeting, he started buying shares in the company.

The prosecution alleged that Abdel-Malek had printed out price-sensitive information about the proposed deal and given it to Choucair before his meeting with Fiyaz, suggesting that the other trader was not the source of his information. Choucair had a different version.

After Choucair bought the NorthStar shares, his other associates, Fiyaz, Nathaniel Glas, and Alexis Kuperfis did the same, the prosecutor John McGuinness told the jury.

The prosecutor showed Choucair the kind of price sensitive information Abdel-Malek had accessed on the UBS database.

The jury heard that disseminating false rumours in the market could amount to a criminal offence. Mr Fiyaz, 46, has not been charged with any offence. The Pakistani billionaire was not named on the FCA’s indictment and has not been in court to answer the prosecutor’s questions in person.

Mr Choucair faces five counts of insider trading filed by the FCA along with Fabiana Abdel-Malek, a former compliance officer at UBS whom the regulator alleges passed Mr Choucair confidential information on companies that the Swiss bank was advising. Insider trading carries a maximum seven-year sentence.

The yacht Ecstasea is one of the fastest large yachts around, powered by 4 MTU engines and a General Electric LM 2500 gas turbine, and can accommodate 2 helicopters on two decks.

In 2009 Abramovich sold the yacht Ecstasea to an Middle Eastern country's ruler. In 2014 the ruler sold Ecstasea to Alshair Fiyaz.

Alshair Fiyaz and his brother Javed Fiyaz live in London, St. Tropez and Monaco. Alshair Fiyaz was also named in Panama Papers. He is the founder of ALFI Investments. ALFI Investments is an investment company active in shipping, retail and leisure. Alshair Fiyaz also owns the Polo Club Saint Tropez.